Baliga v. Link Motion Inc.

Background

On May 26, 2023, Vincent Wenyong Shi filed a proposed order seeking emergency relief against court-appointed receiver Robert W. Seiden. Shi asked the court to prevent Seiden from convening an extraordinary general meeting of Link Motion Inc. shareholders. The court temporarily enjoined Seiden and his agent in China, Francis “Lilin” Guo, from proceeding with shareholder meetings, including meetings noticed for May 30 and May 31, until further order.

The receiver responded to Shi’s request and submitted numerous receipts concerning Guo’s expenses under a court-approved Convertible Note Agreement. Under that agreement, the expenses supported converting Guo’s debt into Link Motion equity, which allowed Guo to obtain substantial voting power in Link Motion.

The receipts were in Chinese. The receiver maintained that Guo’s expenses were legitimate and said the receivership lacked the funds to obtain a certified translation. Shi said that, to the extent he could translate the receipts, they appeared to show luxury-hotel stays, personal expenses, and transfers of money to Guo himself. The court stated that it could not accept either side’s characterization without a certified translation.

Court’s Action

The court reserved its decision on Shi’s motion. It extended the injunction previously entered while the receiver’s accounting of expenses—including Guo’s expenses—was resolved. The court explained that this approach would preserve judicial resources and avoid conflicting orders.

A hearing addressing Guo’s expenses and compensation had been scheduled for June 27, 2023 before Magistrate Judge Figueredo. The court stated that the receiver could address the validity of the expenses at that hearing by providing a certified translation.

The court also addressed who should bear the translation costs. It concluded that the more appropriate procedure appeared to be for the receiver to incur the costs and then seek reimbursement by motion, rather than require Shi to advance the money. The court directed the receiver to provide a certified translation of the Chinese-language documents and stated that the receiver may seek reimbursement as appropriate.

Disposition and Significance

This order did not decide whether Guo’s expenses were valid or whether Shi’s request for emergency relief should ultimately be granted or denied. It continued the existing injunction, reserved decision on Shi’s motion, required a certified translation, and allowed the receiver to seek reimbursement of translation costs. Judge Victor Marrero issued the order on June 21, 2023.